
Canara Bank is planning to expand its credit card customer base to 1 crore (10 million) within the next 7-8 years. To achieve this, the bank intends to separate its credit card division and transfer it to its non-banking finance company (NBFC). They have already started the process of seeking regulatory approval to convert their software services and products subsidiary, Canbank Computer Services Ltd (CCSL), into an NBFC.
As part of this transformation, Canara Bank will acquire the 30.86% stake collectively owned by Bank of Baroda, Karur Vysya Bank, and DBS in CCSL. The valuation exercise for buying out this stake is currently underway. By hiving off the credit card wing to the NBFC, Canara Bank aims to provide focused attention to this business and grow its credit card customer base to 1 crore over the next 7-8 years.
Canara Bank’s Managing Director and CEO, K Satyanarayana Raju, emphasized the bank’s focus on improving the value of its investments, whether through subsidiaries or the bank itself. By housing the credit card business in a separate subsidiary, Canara Bank is following the example of other public sector banks like State Bank of India and Bank of Baroda, which have subsidiaries for their credit card operations.
CCSL, established in 1994, is a software company promoted by Canara Bank. Initially providing IT solutions for the financial services industry, the company has expanded its focus to areas like e-Governance. Canara Bank currently holds a majority stake of 69.14% in CCSL. As of March 2024, Canara Bank is India’s fourth-largest public sector bank, with a total global business of ₹22,72,968 crores (approximately $303 billion).